Commercial use clarified for nurses’ residences

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In a recent judgment, the Supreme Court laid down broad principles for determining whether an activity is for a commercial purpose for the purpose of section 2(1)(d) of the Consumer Protection Act, 1986.

In Lilavati Kirtilal Mehta Medical Trust v M/S Unique Shanti Developers & Ors, Shanti Developers had developed two buildings with 32 single-bedroom flats with living room and kitchen in the Thane area of Maharashtra state. Out of these, Lilavati Trust took possession of 29 flats for the provision of hostel facilities for nurses employed by Lilavati Hospital, which was run by the trust.

The flats were used for the purpose of hostel facilities until 2002. However, within two to three years of completion of the project, because of alleged poor building quality, the structure became dilapidated. Lilavati Trust vacated the flats in 2002, and since 2004 the flats remained unused.

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The dispute digest is compiled by Bhasin & Co, a corporate law firm based in New Delhi. The authors can be contacted at lbhasin@bhasinco.in. Readers should not act on the basis of this information without seeking professional legal advice.

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